Section 179 is a special tax deduction allowing you to recover all or part of the cost of a piece of equipment in the year the equipment is put into service. Equipment must be for business use, acquired by a form of purchase (cash, lease, or loan), & eligible under IRS guidelines. This is a way to rapidly write-off the equipment versus taking depreciation deductions over the life of the asset.
Tangible property - used as part of the business operation, production, or manufacturing.
In 2013, businesses are allowed to write-off as much as $500,000 of qualified equipment acquired over the course of the year. There is also a 50% Bonus Depreciation this year.
| 2013 Equipment Cost: | $ | |||
| Section 179 Deduction: | $ | |||
| Bonus Depreciation Deduction: (50% in 2013) |
$ | |||
| Regular First Year Depreciation Deduction: | $ | |||
| Total First Year Deduction: | $ | |||
| 2013 Tax Savings: (assuming a 35% tax bracket) |
$ | |||
| Lowered Cost of Equipment after Tax Savings: | $ | |||
*All examples provided herein are for illustrative purposes only. Actual numbers will vary based on credit and individual financial situations. Geneva Capital LLC recommends each customer review their own unique situation with their tax advisor. All transactions are subject to equipment and credit approval. |
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